You Purchased 6 Call Options with a $40 Strike Price

question 91

Multiple Choice

You purchased 6 call options with a $40 strike price at a total cost of $150.On the expiration date,the underlying stock was priced at $39.20.What is the percentage return on your investment?

• A) -420 percent
• B) -100 percent
• C) 68.75 percent
• D) 2.02 percent
• E) 220 percent

---

Definitions:

Simple Interest

An interest calculation method where the charge is based on the original principal amount, unaffected by the added interest.

Required Rate

The minimum return an investor expects to achieve by investing in a particular asset, taking into account its risk level.

Simple Interest

Simple interest is a method of calculating interest where the interest charge is based solely on the principal amount, not on previously earned interest.

Discounted

The process of determining the present value of a future amount by applying a discount rate.